Asian naphtha cracks rise

Asia's naphtha cracks rose for a third straight session to reach $112.38 a tonne on Monday, the highest since January 2, pushed up by demand and stronger fundamentals in the gasoline sector. South Korea's Lotte Chemical emerged late last week to seek naphtha for a 12-month delivery starting July through a tender expected to be awarded this week.
The petrochemicals maker on May 17 bought naphtha from the spot market for first-half July delivery at premiums within the $15 to $16 a tonne range to Japan quotes on a cost-and-freight (C&F) basis. India's Bharat Petroleum Corp Ltd (BPCL) offered up to 40,000 tonnes of naphtha with total paraffin content at a minimum of 84 percent for June 19-20 loading from Kochi through a tender closing on May 23.
Mangalore Refinery and Petrochemicals Ltd (MRPL) offered 35,000 tonnes of naphtha with a total paraffin content at a minimum of 75 percent for June 15-17 loading from New Mangalore through a tender closing on May 21. On May 9, MRPL received premiums of $29 or slightly more to Middle East quotes on a free-on-board (FOB) basis for a cargo it sold for early June loading, making that the highest it has received in about three years.
Kuwait Petroleum Corp (KPC) offered a prompt full-range naphtha cargo through a tender closing on Monday.
Essar Oil was also looking to sell naphtha for June 19-23 loading through a tender closing on May 23. Asia's gasoline crack was at $9.70 a barrel, just 1.6 percent below May 17's level when it touched a 3-1/2 month high after a sharper-than-expected drawdown in petrol stocks in the US as summer demand kicked in.
In India, BPCL has bought 15,000 tonnes of gasoline for delivery to Haldia but details were not immediately clear, traders said.
BPCL has an outstanding tender to buy 35,000 tonnes of gasoline for May 25-30 delivery to Kochi. Rising demand may have prompted the refiner to import gasoline as it does not regularly buy the fuel, traders said.
Indonesia's Pertamina issued a tender, which closes on May 24, looking to buy 2 to 3 cargoes of 98-octane grade gasoline for a six-month delivery period starting July. Each cargo size can range from 30,000 barrels, 40,000 barrels or 50,000 barrels. This was in addition to two spot tenders it issued last week.